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Retirement through the (st)ages

YOUR PERSONAL LONG-TERM EARNINGS

Present annual income*Years until retirement $20,000 $30,000 $50,000 $100,000

10 229,276 343,916 573,194 1,146,388

20 537,406 806,110 1,343,518 2,687,036

30 951,508 1,427,262 2,378,770 4,757,540

40 1,508,027 2,262,038 3,770,061 7,540,122

50 2,255,939 3,383,908 5,639,843 11,279,686

*Table assumes 3 percent increase in annual income

THE COST OF NOT SAVING

Age 10 20 30 40

25 $1,051,518 $1,390,078 $1,499,086 $1,532,183

35 $338,560 447,468 480,665 -

45 109,008 142,105 - -

55 33,097 - - -

Table assumes 12 percent interest on $2,000 for stated number of years

Withdrawal is at age 65

THE BENEFITS OF SAVING IN AN IRA

Name Age Years until retirement IRA Total ending investment

Emily 25 40 Yes $4,091,908

Steve 25 40 No $878,674

Lori 40 25 Yes $489,424

David 40 25 No $177,081

Amy 55 10 Yes $46,699

Tom 55 10 No $26,425

Table assumes a $2,000 contribution is made each year with a 15 percent rate of return.

The investments made without the benefit of an IRA are subject to a 28-percent tax bracket.

Chart courtesy Smedley Financial Services Inc.

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